Corporate accounting: issue, forfeiture, reissue of shares; liquidation; mergers and reconstruction - Question Bank
1. The Securities Premium Account can be used for:
2. When a company is reconstructed by absorption, the purchasing company's accounting entries typically involve:
3. Which account is debited when shares are forfeited due to non-payment of calls?
4. In the liquidation of a company, the first charge on the assets available for distribution to shareholders is:
5. When shares are issued at a discount, the discount allowed cannot exceed:
6. Which type of reconstruction involves substantial changes in the company's capital structure, including alteration of share capital and debt?
7. If forfeited shares are reissued at a price higher than the amount paid up on them, the excess is credited to:
8. The term 'contributory' in liquidation refers to:
9. When shares are forfeited, the amount paid by the shareholder is credited to:
10. Which of the following is a common feature of both amalgamation and absorption?
11. In the event of liquidation, the liquidator's first duty is to:
12. The journal entry to record forfeiture of shares, when shares are issued at par, includes debit to Share Capital Account for:
13. Shares can be reissued at a price not less than:
14. When a company is liquidated, its separate legal entity:
15. Reconstruction of a company is undertaken primarily to:
16. Which of the following is a preferential creditor in liquidation?
17. In the context of liquidation, the 'statutory meeting' is held by:
18. The difference between the nominal value of forfeited shares and the amount received on their reissue at a discount is debited to:
19. When shares are forfeited, the amount already paid by the shareholder is:
20. Which of the following is a characteristic of shares issued at a premium?
21. Consolidation refers to the combination of:
22. Which of the following is a type of merger?
23. In case of liquidation, the liquidator's remuneration is typically paid out of:
24. The amount received on forfeiture of shares is a gain to the company and is ultimately transferred to:
25. If a company issues shares at a discount, the discount is debited to:
26. When shares are issued at par, and then forfeited, the Share Capital Account is debited with:
27. A scheme of arrangement for reconstruction is usually sanctioned by:
28. Internal reconstruction typically involves:
29. External reconstruction involves:
30. Compulsory liquidation is ordered by:
31. Voluntary liquidation can be initiated by:
32. In case of liquidation, after paying all external liabilities, the remaining assets are distributed among:
33. The balance in the Share Forfeiture Account after reissue of all forfeited shares represents:
34. If forfeited shares are reissued at a discount, the discount is debited to:
35. When shares are reissued, the Share Capital Account is credited with:
36. Shares are forfeited when a shareholder fails to pay:
37. The process of winding up the affairs of a company and selling its assets to pay off its liabilities is called:
38. Which of the following is a common reason for corporate liquidation?
39. In a merger, two or more companies combine to form:
40. When one company takes over another company, and the acquired company ceases to exist, it is known as:
41. Under which method of reconstruction does a new company take over the business of one or more existing companies?
42. Which of the following is NOT a method of corporate reconstruction?
43. In the event of liquidation, which of the following has the first claim on the assets of a company?
44. What is the maximum discount at which forfeited shares can be reissued?
45. The amount standing to the credit of the Share Forfeiture Account at the time of reissue of forfeited shares is transferred to which account?
46. When shares are forfeited, the Share Capital Account is debited with:
47. If a company fails to receive the minimum subscription within 120 days of the issue of the prospectus, what must happen to the application money collected?
48. What is the minimum subscription amount that must be received by a company before it can proceed with the allotment of shares?
49. When shares are issued at a premium, the premium amount is credited to which account?